New Class of BRICS Countries Brings Debt, Conflict into Coalition – Argentina Politely Declines

The anti-American BRICS economic and security coalition will welcome five new members on January 1: a country in a severe economic crisis, another openly defaulting on its sovereign debt, and two countries embroiled in a proxy war against each other.

BRICS is a coalition joining the five countries that comprise its acronym: Brazil, Russia, India, China, and South Africa. China is largely believed to be its most influential member, though it often comes into conflict, including military confrontations, with neighboring India. The group uses its alliance to protect each other from accusations of human rights atrocities, presenting a united front on issues such as the Uyghur genocide and the Russian invasion of Ukraine, and to seek economic independence from America.

The overt objective of the organization is to facilitate cooperation among the emerging economies, which together can aspire to rival America’s geopolitical influence. The coalition will double in size in the new year, introducing Egypt, Iran, Saudi Arabia, the United Arab Emirates (UAE), and Ethiopia to the fold.

Following the BRICS summit in South Africa in August, the group announced that it had accepted six countries to become members, chosen out of allegedly dozens of interested parties. The sixth country scheduled to join BRICS in 2024 was Argentina; recently inaugurated libertarian President Javier Milei sent letters to the heads of government of the six BRICS countries in the last week of December formally declining the invitation.

Milei, a hardline anti-communist, promised while campaigning for president that his government would not seek closer ties with China or any communist country, and instead foster relations with “civilized” nations, paramount among them America and Israel.

In his letter to the BRICS leaders, the president, who took office on December 10, stated that he did “not consider opportune the incorporation of the Argentine Republic into BRICS” because “the foreign policy of the government [he] preside[s] over since a few days ago differs in many cases with that of the preceding government.”

“I would like to emphasize the commitment of my government to the intensification of bilateral ties with your country, in particular regarding the increase in commerce and influx of investment,” Milei added. The president reportedly sent five different letters to each president; the letter published in the Argentine newspaper Clarín was addressed to Brazilian President Luiz Inácio Lula da Silva.

With Argentina – and its historic economic crisis – out of BRICS, the coalition is left to incorporate the other five nations, all of which are in Africa and the Middle East. Incorporation began at a “sherpa meeting” in South Africa in December, Bloomberg reported on Friday, that senior officials from Egypt, Iran, Saudi Arabia, Ethiopia, and the UAE attended. Their presence was a confirmation of their commitment to the group, Anil Sooklal, Pretoria’s ambassador to BRICS, told Bloomberg.

While the presence of multiple major oil producers will significantly increase BRICS’ influence over that particular industry, nearly every new member is introducing a new crisis to the group – with the exception of the UAE, whose thriving economy and friendly foreign policy towards even Israel establishes it as clearly the most valuable new member of the team.

Paramount on the concern list is Ethiopia, which only recently exited a brutal civil war between the Oromo-led government of Prime Minister Abiy Ahmed and the Tigray People’s Liberation Front (TPLF), a Marxist paramilitary tied to the ethnic Tigray minority. The two sides agreed to a ceasefire in December 2022 that has largely ended direct hostilities, though a brewing conflict rapidly emerged between the Oromo and Amhara people following the ceasefire. In May, shortly before his abrupt and ongoing disappearance, former Chinese Foreign Minister Qin Gang said his nation would invest heavily in “post-war reconstruction” in Ethiopia. Chinese investment in the country, however, is at the root of its economic woes.

Ethiopia is a member of the Belt and Road Initiative (BRI), China’s global predatory lending plan in which it offers unfavorable loans to poor countries, then leverages its influence when the country cannot pay them back. Most BRI deals are largely secretive, meaning their provisions and amounts are not available to the general public.

Ethiopia defaulted on its sovereign debt in the last week of December after seeking debt relief unsuccessfully since 2021. Potentially in pursuit of protecting BRICS, China suspended debt payments from Ethiopia until July 2024, but the move will likely do little to protect Ethiopia’s credit ratings or elevate its economic influence and stability.

Neighboring Egypt is in a better economic state than Ethiopia, but is nonetheless enduring a severe economic crisis similar to that of Argentina: annual inflation in the country hit an all-time high of 29.7 percent in August 2023, making daily life increasingly prohibitively expensive for many Egyptians. Voice of America observed in September that food and drink prices rose 71.9 percent year-on-year as a result of both inflation and threats to the food supply by global disruptions such as the Russian invasion of Ukraine. Strongman Abdel Fattah al-Sisi managed to “win” re-election in another sham vote in December, suppressing growing frustration with his poor economic performance and distracting the public with the ongoing conflict between Israel and Hamas (Egypt supports Hamas, but enthusiastically objects to helping Palestinian civilians).

That leaves Iran, the world’s most prominent state sponsor of terrorism, and its arch geopolitical enemy Saudi Arabia, as the final two inductees into BRICS in January. Saudi Arabia brings to the table one of the world’s most prosperous oil companies, Aramco, and a relatively peaceful relationship with America compared to other members of the coalition. It also brings with it deep-seated antagonism towards Iran.

The Chinese Communist Party has taken the lead role in BRICS in improving relations between the two countries. In March, Beijing hosted a summit in which Riyadh and Tehran agreed to restart diplomatic relations, reopen embassies, and allow flights between their countries. The announcement came as a shock after years of Iran funding the Yemen-based Shiite Houthi terrorist organization, which routinely bombs Saudi Arabia, threatening Aramco assets and going so far as to target Mecca, the holiest city in Islam. Iranian officials have disparaged Saudi Arabia as illegitimate stewards of the holiest sites in Islam. The Saudis, on their part, have claimed that Iranian Shiites were “not Muslims.”

The new era in Saudi-Iranian relations appears to be holding for now. The two countries sent their deputy foreign ministers to Beijing in December to recommit to normalizing relations, apparently a warm-up for cooperating in BRICS. Both Tehran and Riyadh have elevated their anti-Israel rhetoric in defense of Hamas following October 7. The Houthi issue continues to divide the two countries, however, as Saudi Arabia remains directly involved in the Yemen civil war and reported attempts at peace talks have yet to succeed. One Houthi missile targeting a core Saudi asset could rapidly deteriorate the diplomatic progress China has taken credit for.

Russian Foreign Ministry Sergey Lavrov claimed this week that another 30 countries are hoping to one day join BRICS. The coalition seems to have more than enough work on its hands with the new five.

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